The report concludes that most impact will likely be on industrial groups that account for the bulk of global trade, such as transportation equipment, chemicals, machinery, and computer and electronic products.
The magnitude of resultant job gains will depend heavily on the degree to which the U.S. continues to enhance its global competitiveness. One of the biggest challenges facing U.S. manufacturers is the supply of skilled labor. "However, our analysis shows that, in the short term, any U.S. manufacturing skills gap is unlikely to be significant enough to curtail a U.S. manufacturing resurgence. Rather, such shortages are more of a long-term risk if action is not taken soon to train and recruit new skilled workers."
Pendulum Swings Back
It's been widely reported that for much of the past four decades, manufacturing work has been migrating from the world's high-cost to its low-cost economies. Generally, this has meant a transfer of factory jobs of all kinds from the U.S. to abroad.
The pendulum finally is starting to swing back, says the report, and in the years ahead, it could be America's turn to be on the receiving end of production shifts in many industries.
BCG writes, "In previous reports, we cited a number of examples of companies that have shifted production to the U.S. from China and other low-cost nations. These companies range from big multinationals like Ford and NCR to smaller U.S. makers of everything from kitchenware and plastic coolers to headphones. More recently, computer giant Lenovo opened a plant to assemble Think-brand laptops, notebooks and tablets in North Carolina. And, Toshiba Industrial has moved production of its hybrid-electric vehicle motors from Japan to Houston."
BCG also reports that Airbus has broken ground on a $600 million assembly line in Mobile, Ala., for its A320 family of jetliners, adding, "The facility will create up to 1,000 high-skilled jobs. Also, Flextronics, one of the world's largest electronics-manufacturing-services companies, has announced it will invest $32 million in a product innovation center in Silicon Valley. The company's CEO was quoted in the Wall Street Journal as saying that Flextronics may need to add 1 million square feet of manufacturing capacity in the U.S. over the next five years, depending on economic conditions."
The group also says there is early evidence that foreign manufacturers are starting to move production to or expand production capacity in the U.S. for export around the world. "Toyota announced it's exporting Camry sedans assembled in Kentucky and Sienna minivans made in Indiana to South Korea. The company also suggested that it may ship U.S.-made cars to China and Russia. In press reports, the president of Toyota Motor North America was quoted as saying, 'This is just the beginning of a new era of North America being a source of supply to many other parts of the world.' "
For more on the report, go to www.bcgperspectives.com.